SKT Sky Network Television Limited.

[airedale]

Comment on this thread has focussed on the cash fron the number of paying subscribers. My wife watches a lot of Sky TV and the number of ads on their channels must also generate a healthy cash flow. I can not see this company going broke. Under new management perhaps but not broke, bankrupt or liquidated.
Discl:Holding

[mikelee]

Good point, I see no reason why dividends can't resume next year, regardless of the property sale.

[mistaTea]

"we're reinvesting dividends for growth"

Yes!

All those wise investments have grown the business from $1B to $320M!

At one point I think it grew so much the market valuation dropped below $100M!

[LoungeLizzard]

"we're reinvesting dividends for growth"

Classic gif from Ogg. Laughing in the face of adversity (aka the SKY board) is the only way left for shareholders...

[jimdog31]

Yes!

All those wise investments have grown the business from $1B to $320M!

At one point I think it grew so much the market valuation dropped below $100M!

Surely if you were a friend at foxtel you'd look over at our share price floundering and make a play? I know they have a mountain of debt, but surely the extra $700m revenue, FCF & costs synergies would result in a higher multiple for their float?

[LaserEyeKiwi]

Comment on this thread has focussed on the cash fron the number of paying subscribers. My wife watches a lot of Sky TV and the number of ads on their channels must also generate a healthy cash flow. I can not see this company going broke. Under new management perhaps but not broke, bankrupt or liquidated.
Discl:Holding

Well they will never not bring in revenue. Its all a question of if they maintain enough subscribers/revenue to surpass there expenses, which is in no way a guaranteed thing. There are two unfortunate ways that can happen currently, and they both are based around NZR content rights. Either Sky lose them to a competitor at the next renewal date (and sky hemorrhage a big chunk of subscribers/revenue) or Sky win the rights again but the cost increases to a level where they eventually lead to an operating loss.

[mistaTea]

Well they will never not bring in revenue. Its all a question of if they maintain enough subscribers/revenue to surpass there expenses, which is in no way a guaranteed thing. There are two unfortunate ways that can happen currently, and they both are based around NZR content rights. Either Sky lose them to a competitor at the next renewal date (and sky hemorrhage a big chunk of subscribers/revenue) or Sky win the rights again but the cost increases to a level where they eventually lead to an operating loss.

Correct.

So it then becomes a probability assessment as to how likely either of those scenarios are.

[Rustycage]

Surely if you were a friend at foxtel you'd look over at our share price floundering and make a play? I know they have a mountain of debt, but surely the extra $700m revenue, FCF & costs synergies would result in a higher multiple for their float?

This

ive gotten in trouble in the past by saying “you would think … “ …. But surely this is the perfect time for it?

[mistaTea]

Surely if you were a friend at foxtel you'd look over at our share price floundering and make a play? I know they have a mountain of debt, but surely the extra $700m revenue, FCF & costs synergies would result in a higher multiple for their float?

I think the low SP becomes more of a worry for Foxtel.

They wouldn’t be able to buy sky for anywhere near $330M for one - so if they want to acquire the business they would need to take on another half a billion dollars of debt.

But secondly, sky is virtually identical to Foxtel and has also grown the streaming book considerably.

So given these two companies have almost identical strategies…and even though sky is still profitable and FCF positive it still has a very low market valuation.

That will not help FOXTEL with their endeavours to convince instos to pay handsomely to buy the business. They will look at the Sky experience for comparison.

[mistaTea]

Discovery want it all!!

"But when you think about viewers and content, we want to be in all territories. We want to be in linear, we want to be on paid TV, we want to be in ad-funded streaming and we want to be in paid streaming."

They just described Sky TV. Ha!